"My accountant gave me a call on the telephone and told me we couldn't file electronically," says Jonathan Agin.

The IRS granted Jonathan Agin an extension to file his 2011 taxes. He needed time to grieve the loss of his daughter Alexis. She was full of life, even as a brain tumor took a toll on her little body.

"She was an amazing little girl, she never complained once," says Agin.

Alexis died just a few weeks shy of her 5th birthday. When Jonathan mustered the energy to finally file the family's taxes, he got another blow.

"Someone had stolen Alexis' social security number and used it to file a tax, a tax return," says Agin.

In District Heights, another person learned she'd been hit.

"I said, they must've made a mistake or something," says Nadine Brandford.

Brandford's social security number was used for a different kind of identity theft. She filed her taxes with H&R Block in January of last year, and got a refund for over $6,000. But in December, she got a bill from the tax service telling her she needed to pay back a loan she supposedly secured.

In 2012, someone went to an H & R Block branch and used Nadine's social security number to take out a loan for a thousand dollars in her name.

Then, they came to a 7-11 store, just a block away, and used the ATM to get the money from the prepaid debit card H & R Block gave them.

"I don't see how they can go into H & R Block and take out a loan and not show an ID or pay stub," says Brandford.

"5, 10, 15 years later, someone still has your information. They still haven't been caught. I mean, they may not have it. They may have sold it to someone else, and someone else may be violating you," says Butler.

This kind of ID Tax Theft can happen in several ways but e-filing is helping to fuel it. It's often hard to spot and prosecute. But the IRS says it's efforts in 2012 helped to protect 20 billion in revenue related to fraudulent returns.

Jonathan Agin thought his daughter's social security number was safe. He thinks Alexis' ID was compromised because of a government death master file that contains the name, date of birth, address and full social security number of any person who dies. All you have to do is go online to buy it.

"You're powerless. You really have no ability to safeguard your loved one's identity after they die," says Agin.

When asked if she was nervous about other potential crime in her name, Nadine responded: "I'm very worried, because they can take out bigger loans. They can destroy me, doing this."

After we contacted H&R Block about Nadine's case, the company decided to make this situation right.

In a statement, the director of corporate communications told us:

"We take this matter seriously and apologized for the breakdown the communications process. This is an isolated incident and we are working directly with the client to resolve the matter. We have absolved the client of the debt and will provide identity theft protection services at our expense."

Identity crime is devastating. The IRS handled 1.2 million cases of it in 2012. You can do everything right and still have this happen to you. So, the best thing you can do to protect yourself, is to try and prevent it in the first place.